O'Connor's rise and fall

Former San Diego mayor Maureen O'Connor appeared in federal court Thursday to plead not guilty on a money laundering charge. She is accused of embezzling money from non-profit organizations to fuel a gambling habit. She was accompanied by her attorney Eugene Iredale.
— Peggy Peattie

Former San Diego mayor Maureen O'Connor appeared in federal court Thursday to plead not guilty on a money laundering charge. She is accused of embezzling money from non-profit organizations to fuel a gambling habit. She was accompanied by her attorney Eugene Iredale.
— Peggy Peattie

San Diego  Just before 10 a.m. Thursday, Maureen O’Connor made her way slowly, uncertainly into a small courtroom on the ground floor of the federal courthouse in downtown San Diego for what was going to be one of the more humiliating moments in her life.

The courtroom was just a few blocks from San Diego City Hall and the 11th floor office that O’Connor occupied for 6½ years as the city’s first female mayor.

But the decline in O’Connor’s life between those heady days as mayor and her appearance as a defendant in a federal criminal case last week was far greater than the distance between the courthouse and City Hall.

Once vigorous and athletic, the products of a youth spent as an accomplished swimmer, the 66-year-old now uses a cane and tires easily.

Once articulate with a knack for math, she now has trouble at times following conversations, reading, even speaking, the remnants of a stroke following brain surgery.

And once wealthy, the beneficiary of a fortune estimated at $50 million left by her businessman husband, Robert O. Peterson, O’Connor is now virtually broke, the result of a stunning gambling addiction.

Her financial collapse is largely the product of years of gambling at casinos in San Diego, Las Vegas and Atlantic City. O’Connor — whose only known vice in her City Hall days was a penchant for Diet Pepsi — wagered more than $1 billion cumulatively over a nine-year span, most of it run up by spending hours at video poker machines.

Her net loss from the gambling came to an astonishing $13 million, her lawyer said. Those mounting losses led in 2008 and 2009 to her taking $2 million from the charitable foundation established by her late husband, co-founder of the Jack In The Box restaurant chain, and using it to pay casino debts and continue gambling.

She has pleaded not guilty, but her case is on hold for two years in an agreement with the U.S. Attorney’s Office.

During that time, she will have to try to pay back the money, or as much as she can. She said last week she intends to do so and always did. She’ll also have to undergo counseling for gambling addiction.

The revelations shocked those who worked with O’Connor in her public life.

“It reminds me of a Shakespearean tragedy,” said Sal Giametta, chief of staff to county Supervisor Ron Roberts.

“You have this incredible rise, the prominence she had, and now to see something like this take place, it’s very disturbing,” said Giametta, who got his start in government as an O’Connor staffer.

Dad was a bookie

O’Connor was the eighth of 13 children in a Mission Hills Irish-Catholic family, headed by her boxer-turned-bookie father.

Her interest in politics was ignited after seeing what she thought was the poor treatment of Mexican Indians working San Diego’s bicentennial celebration. Her complaints to the powers that be were ignored.

So O’Connor launched a grass-roots campaign for City Council, with her twin sister, Mavourneen, checking out a book from the library on how to run a campaign.

She won. The 25-year-old Catholic school gym teacher was the youngest to hold a council seat. Six years later, she wed Peterson, a financier 30 years her senior, in a small ceremony on the French Riviera.

Former San Diego Mayor Maureen O'Connor in a file photo from 2000. — Earnie Grafton

+Read Caption

Former San Diego Mayor Maureen O'Connor in a file photo from 2000.
— Earnie Grafton

Her initial 1983 mayoral campaign against county Supervisor Roger Hedgecock failed, but she later won when Hedgecock was forced to resign amid a campaign finance scandal. She took office in 1986, answering to the nickname “Mayor Mo.”

She left behind a mixed bag of accomplishments and failures — and her share of critics and fans.

She knew how to play to the public, sometimes leading to criticism from those in City Hall about her lack of leadership and poor communication.

Her absences from meetings was a running joke, as insiders questioned what she did all day. She was also known to take in a midday matinee movie during the week.

She butt heads with the business interests and developed her image as a populist who met regularly with citizens, picked up trash with city crews, rode with police officers on patrol and walked tough neighborhoods.

She was applauded for her fierce fight against Southern California Edison’s takeover effort of San Diego Gas & Electric, which she won.

In one of her more memorable actions, O’Connor spent 48 hours as an undercover homeless woman, sleeping on the street, witnessing drug deals and prostitution, and experiencing firsthand how the city’s outreach programs worked.

She hid her famous face behind a ball cap and sunglasses, passing notable San Diegans on the street who didn’t recognize her as she walked the city on blistered feet.

At the end of her mayoral run, O’Connor largely receded from the public spotlight. She remained social, spending time with her close friends and her siblings.

Influential female friends

At one time, O’Connor was counted among the three most powerful women in San Diego, along with philanthropist and McDonald’s heiress Joan Kroc and San Diego Union-Tribune Publisher Helen Copley. The three women frequently used their wealth and influence to frame the public conversation and partner on civic projects.

But they were also best friends, along with Oscar-winning actress Mercedes McCambridge, and privately bonded over their love of cinema and their shared Catholic values.

Copley and O’Connor enjoyed walks at La Jolla Shores, and the foursome would sometimes jet off in Kroc’s private plane or boat. They were some of the only women, besides a few nuns and her family, that O’Connor allowed to penetrate her small inner circle.

But by the end of 2004, within a span of only nine months, O’Connor’s tight circle shrank with the deaths of all three of her closest friends.

“Those were the women she identified with,” said Gerry Braun, a former San Diego Union-Tribune reporter who covered O’Connor as mayor. “Their loss I think is more important than people realize.”

The grief exacerbated a festering gambling addiction, one of her attorneys said last week.

Always considered a somewhat private person, O’Connor became more reclusive following her husband’s death in 1994, and especially so after her girlfriends passed. She relied on her close-knit group of siblings as her confidantes.

But Ben Dillingham, her former chief of staff, said that O’Connor did not completely withdraw. She just did her work out of the limelight.

“She loved to go out and help people, and she did it all very privately,” Dillingham said. “She was never the big party type. She didn’t go where she was likely to attract public attention.”

One of her recent outings was at a viewing for Copley’s son, David Copley, after his death in November. Those who attended said she seemed a bit frail but well.

Few had any inkling of what Eugene Iredale, O’Connor’s defense lawyer, described as her “lunatic” gambling compulsion.

“Complete surprise,” Giametta said.

Dillingham, who said he spoke with her on the phone often after she had a benign brain tumor removed in January 2011, said he knew that O’Connor gambled over the years but not excessively.

“I knew she gambled in the same way I knew that she liked to go to the movies,” he said.

She took private jets to casinos, where she went inside via a private entrance reserved for high rollers. She also went to local casinos, including the Barona Resort and Casino in Lakeside.

Her preferred game was a solitary one: video poker. She apparently played for hours at a time.

“Video poker is the crack cocaine of the business,” said Las Vegas gambling expert Stephen Gordon.

Video poker machines with maximum bets of $100 are common at casinos, and even $500 machines exist at some of the high-roller rooms.

That’s $1,000 for just two pops of the button. “It doesn’t take long,” Gordon said.

For O’Connor, it took about a decade to blow through her fortune, although medical records say her gambling habit began even earlier, after her husband’s death in the mid-1990s. Along the way she sold homes, borrowed money from friends and liquidated savings.

She continues to receive an annual city pension of about $36,600.

O’Connor also has had serious health problems. After her brain surgery, she suffered a stroke. Iredale contended the tumor had been there for years and was in an area of the brain that controls decision making and judgment. It could have contributed to her gambling compulsion, he said.

Federal prosecutors, who said O’Connor ran up her debts from 2000 to 2009, don’t agree.

Whatever the tumor caused, the operation left O’Connor physically diminished.

Booked and sent home

On Friday, O’Connor again came downtown again to the federal courthouse. No cameras awaited her outside like the day before, when she entered her not guilty plea.

Iredale said she was tired but gratified by the support she had received over the past 24 hours. He said she was also embarrassed by her conduct.

She went to the basement where the U.S. Marshals Service office is located. And then, the woman whose picture once appeared regularly on the front page of the U-T and who left a lasting imprint on the city as mayor, was formally booked into the federal prison system.

Marshals took her fingerprints. They took a booking photograph.

O’Connor was then free to go, back to the Mission Hills home she shares with her twin.

Key dates in Maureen O’Connor’s life

July 14, 1946: Maureen Frances O’Connor is born in San Diego, the eighth of 13 children of Jerome and Frances O’Connor.

1970: Graduates from SDSU with a bachelor’s degree and a triple major in sociology, recreation and psychology. Becomes a physical education teacher at Rosary High School.

Nov. 2, 1971: In an upset, wins a City Council seat at the age of 25.

Sept. 16, 1975: Wins re-election to the council.

Jan. 1, 1976: Serves on the Metropolitan Transit Development Board and helps develop the San Diego Trolley.

May 9, 1977: Marries Jack in the Box co-founder Robert Peterson in France.

1979: Leaves the City Council near the end of the year, fulfilling a promise to serve only two terms.

Dec. 16, 1980: Appointed to the San Diego Unified Port District board.

May 3, 1983: Loses to county Supervisor Roger Hedgecock in a special mayoral election to replace Pete Wilson, who had been elected to the U.S. Senate.

June 3, 1986: Defeats Councilman Bill Cleator to fill the unexpired term of Mayor Hedgecock, becoming San Diego’s first woman mayor. Hedgecock had resigned after a felony conviction that was later overturned.

June 7, 1988: Easily wins a second term as mayor over ex-Councilman Floyd Morrow.

Dec. 7, 1992: Leaves office after choosing not to run for re-election.

April 19, 1994: Becomes a widow when her husband dies at their Point Loma home.

April 1997: Travels to flood-ravaged Grand Forks, N.D., with close friend Joan Kroc, who gave $15 million to help the community.

August 1997: Organizes a meeting in San Diego to fight for funding for the National Endowment for the Arts.

September 1997: Questions the city’s stadium deal with the Chargers that provides a ticket guarantee.

September 1998: Kroc announces an $80 million donation to the Salvation Army for a community center in East San Diego. She said she came up with the idea after O’Connor walked her through the neighborhood.

Nov. 5, 1999: Marches with African-American leaders to protest the fatal police shooting of former pro football player Demetrius DuBose.

July 20, 2000: Calls for the city to declare a state of emergency over skyrocketing electricity rates.

May 2005: Calls in a U-T opinion piece for a mail-in election to choose a successor to Mayor Dick Murphy, who had resigned.

Jan. 18, 2011: Undergoes surgery to remove a benign brain tumor.

Feb. 14, 2013: Admits in federal court she took $2 million from a nonprofit set up by her late husband and used the money to feed a billion-dollar gambling habit.